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The first three months of retirement – May/Jun2016

The day that you shut down your computer, finish your shift, or walk out of your office building, for the last time can be filled with mixed emotions. Most retirees I know are excited about the future but also anxious about what the next chapter in their life will look like. Many also wonder if they have saved enough money to do what they want to do in retirement.

You’ve spent your working life preparing for this time, saving your money, learning how to invest it and making plans. In the 90 days after you retire it is crucial you get a grip on your personal finances and know exactly where you stand. Here’s how to spend the first three months of freedom from work.

Meet with the professionals

In the first three months make sure you make an appointment and meet face-to-face with all the professionals that help you with your money. They can help you understand where you realistically stand financially. This would include an accountant, your financial advisor and lawyer if you have one. Also take some time to meet with your kids, or someone else you trust, after. This is to let them know where your finances are at. It’s important that someone close to you knows about all your investments, bank accounts and other assets.

Set goals

Just because you have retired doesn’t mean you stop setting financial objectives. Make a 5-10-15 year plan. What do you want to accomplish and get done working with this time horizon? If an extended world tour is on the agenda in five years, you have to start planning now, making sure you have enough money. Also, start making arrangements for someone to watch your place while you’re gone, or if you’re renting it out (which is the smartest thing to do) finding a tenant by then.

Your legacy

Now is a good time to start thinking about your legacy. It’s not coming for many years, but now that you have stopped working you should have a fair idea of how much money you will want to leave as an inheritance. Start thinking about where you want your assets to be distributed. If you plan on spending it all on yourself, that is awesome, but still make a plan. Some retirees choose to give their children a living inheritance, which is a great idea. You get to see how that money will help them and it also can save on some capital gains tax.

Spend it

Like I said at the top, you’ve been saving for retirement for a long time and now you should start to take advantage of all that hard work. Drop some of your frugal ways, treat yourself, and relax. After you’ve figured out what your money situation is exactly, it’s time to spend any surplus you have.

For example, if your cost of living is $3,000 a month and you’re netting $3,250 a month, spend the remaining $250 on you. Use it towards a holiday, a new dress, a dinner with friends, whatever it is that enriches your retirement. Do it! You deserve to.

On another note, I just want to take this opportunity to wish our amazing editor Katherine Moore a wonderful retirement. I wish you all the best as you start this awesome journey. I know you say you’re really frugal, but this is the time to bend some of those money-saving rules I’m always preaching. Now is the time to spend money on the people and things that make you most happy.

As finance editor for HOMES Publishing Group, Rubina Ahmed-Haq also shares her expertise in our sister publication Condo Life. In addition, she is a regular contributor on CBC Radio, blogger at RateSupermarket.ca and has her own website alwayssavemoney.ca